Dow Fundamentals On Fire. Metals Stocks UpRocket

1. The PDAC conference is in full swing in Toronto. The PDAC is the Prospectors & Developers
Association Conference. I can tell you that the feel of this conference
is: solid. There is no indication of any mining stocks bubble. Markets
tend to display this kind of aura in their middle phase. Mining stocks
are in the middle phase of a monster bull market, and poised to enter an epic
third phase higher.

2. This 3rd leg higher will be fuelled by financial system implosion fears
that grow amongst institutional investors, not by a 1979-style "I'm
greedy, gimme the gold!" public buying mania. It will be fuelled higher
by long-term central bank gold buying programs, which means long term dollar
devaluation and long term gold revaluation.

3. On Sep 11, 2001, thousands of people were killed as the world trade centre
was destroyed, and the world changed. As the mid-east revolutions
began, once again, the world changed.

4. When the world changes, you need to respond to that change. I began to
short the stock market with real cash, as the mid-east revolutions changed
the velocity of the rise in price of oil, against the dollar. The revolutions
opened the door of possibility, but not the door of guarantee, to a drastic
drop in GDP growth, or even a total elimination of GDP growth, and a return
to official recession.

5. Oil was headed higher anyways, due to Ben Bernanke's trigger finger
on the banksters' money printing gun, as well as long term demand/supply
issues, but the velocity of the price rise suddenly changed, bigtime.

6. Corporations and institutional
money managers around the world are suddenly racing to substantially lower
their GDP and corporate earnings estimates, just here at oil $105. What happens
at oil 115? How about at $125? $150? $200? What happens to institutional
liquidity flows if that happens?

7. Shorting the stock market is not a game, when real money is on the line.
The public is not involved in the market in a big way right now. You don't
have a billion price chasing public investor wieners on the other side of your
Dow short trade, like you did in 1999. Do you see Morgan Stanley issuing you
a free Triple Sell Signal, like they did in 2007? No.

8. Your competitors in the market this time are the Fed, the banksters,
and thousands of institutional money managers. They may not be very nice people,
but they are market winners. The bottom line is you better come to the
Dow shorting battlefield with a lot of weapons, a lot of risk capital ammunition,
and be prepared for a bloody long war.

9. A minor suggestion: Leave granny alone. Granny doesn't need a portfolio
of Dow put options, just because you've "called the turn",
to save her from herself. My "minor" suggestion is: Make a lot
of wealth using your capital, then give some to her!

10. Here's a look at the near-term Dow
Chart. Remember when upside momentum died on gold and gold stocks at
$1387 in October? Momentum is a moniker for the velocity of the rise in price
of an item against the currency it trades against. The upside momentum of
the Dow has died.

11. Click here now to view my longer term Weekly
Dow Chart. What you are looking at over the past month, is the direct
result of institutional money managers re-allocating their cash, to reflect
the effects of their projected oil price ($110-125) on corporate earning
and GDP numbers.

12. If the global revolution theme ends quickly, the markets could go back
to rising mode, but we are fast approaching "sell in May and go away" and
then the Aug-Sep-Oct period that I call "stock market hurricane season",
because crashes often occur in that time period. If you are out of the
market, I would not be looking to enter the market on the buy side in size,
unless we get a much more substantial take-down in price.

13. Ben "Dr. Pinocchio" Bernanke
has a new worry. Oil. A high-velocity rise in the oil
price could speed up the need to raise interest rates. Ben's
hope to keep rates low and then aim a new blast of QE at the stock market may
be seriously delayed or even imperilled, if oil skyrockets.

14. More revolutions could take place, and if they occur in countries like
Saudi Arabia, then the stock market, the T-bond, and the US Dollar could all
go into a united free fall.

15. The risk of this death spiral is real, and it calls for a limited tactical
shorting attack on the stk mkt.

16. Silver. The dreamer
looks at the past, and seeks to recreate and repeat the past. Unfortunately,
that's impossible. The public tried it in the 1990s in the stock market
and in real estate into 2005. Don't repeat the tactics of losers against
a background of pretending to know where silver is going. Silver has soared
in price from the depths of the bear market. Your dollars now only
buy you a fraction of the silver that they bought when there was a glut of
silver. You can't build serious wealth by paying up for
dreams.

17. The (pipe)dreamer thinks, "but what if silver soars like it
just did, maybe silver will be at $200 or even $300, I should back up (what
remains of) my financial truck now!" If I mention silver stocks,
a kind of eerie silence presents itself. A few silver stocks that are soaring are
bought, but most are ignored.

18. Don't buy the sizzle. Buy the steak. The steak is what hasn't
moved. The sizzle is the item you feel the urge to chase after, and
rename that urge "analysis". I'm starting to see highly dangerous
statements about silver's rise being made like, "sell everything
you own, do it now! Put it all in silver, now!"

19. These are the statements
of market losers. They failed to buy into the silver glut and want to re-create
what they just missed. Can't happen. Pipe-dreaming your way to wealth,
solely by following your emotional urges, is not a viable strategy. It's
a price chasing clown act. If silver is going to ten billion dollars
an ounce, or even just 50% higher, where do you think silver stocks
are going?

20. If you don't build ownership of an item in size, you can't
build wealth. The only time size is available is when the item is cheap. Click
here now to view the Silver
Miners ETF Chart. As the price of silver blasts higher, the silver stocks
will move exponentially higher. Notice the huge size of the pyramid is that
I've drawn above the rough $20-27 range. Price could soar to unknown
heights if silver blows thru $52, as I'm 99% sure it will. My strongest
suggestion is to look thru the ETF and find the stocks that really haven't
performed yet.

21. It takes time, a lot of time, for companies to recover from events like the
greatest financial crisis since 1929. I absolutely believe that gold
$1400-1700 is the zone where the stocks begin to do all you hoped they would
do at gold $800-1200.

23. Notice the huge h&s continuation pattern I've highlighted.
The GLDX ETF holds less companies than other ETFs, so it brings you more risk
and more possible reward, because it is more volatile. Using my PGEN pyramid
generator, which goes far beyond scale trading, the GLDX could be the ideal
ETF to play what I believe is coming astronomical volatility.

24. The reality is that the gold community is not greedy at gold $1430. Most
analysts blew it, and shorted gold or sold out into $1310, instead of buying.
Now the game is to wait for some magical correction that is "just right",
to get back in. That crazed mentality is nothing more than jumping out of the
fire and into the fry pan. Rather than standing on the sidelines and waiting
until gold $1700 to make the same type of statements about gold you see on
silver now, instead you need to focus on gold and silver stocks, and
be prepared to buy the weak ones now, and at prices far below what seems rational.

Special Offer for Website Readers: Send me an email today to freereports4@gracelandupdates.com and
I'll rush you my new Flying Five Oil Juniors report tonight! I've
put together the 5 favourite oil juniors from surveys of investors that are
most likely to outperform the BMO oil juniors ETF, provided you use the correct
tactics on them, in the market. I'll go over those tactics in detail
for each stock for you. Thanks!

Note: We are privacy oriented. We accept cheques. And credit cards thru PayPal
only on our website. For your protection. We don't see your credit card information.
Only PayPal does. They pay us. Minus their fee. PayPal is a highly reputable
company. Owned by Ebay. With about 160 million accounts worldwide.

Written between 4am-7am. 5-6 issues per week. Emailed at aprox 8-9am daily.

Stewart Thomson is a retired Merrill Lynch broker. Stewart writes the
Graceland Updates daily between 4am-7am. They are sent out around 8am-9am.
The newsletter is attractively priced and the format is a unique numbered point
form. Giving clarity of each point and saving valuable reading time.

Risks, Disclaimers, Legal
Stewart Thomson is no longer an investment advisor. The information provided
by Stewart and Graceland Updates is for general information purposes only.
Before taking any action on any investment, it is imperative that you consult
with multiple properly licensed, experienced and qualifed investment advisors
and get numerous opinions before taking any action. Your minimum risk on
any investment in the world is: 100% loss of all your money. You may be taking
or preparing to take leveraged positions in investments and not know it,
exposing yourself to unlimited risks. This is highly concerning if you are
an investor in any derivatives products. There is an approx $700 trillion
OTC Derivatives Iceberg with a tiny portion written off officially. The bottom
line: